Minister answers call as Chavalit pulls rank
Thanong Khanthong profiles the new finance minister, Thanong Bidaya.
Last year, when bank analysts of Goldman, Sachs & Co, the US investment bank, asked Thanong Bidaya how he would like investors to view him and the Thai Military Bank (TMB), he replied: ''I want investors to think of TMB as a pure commercial bank. The military is just a name. Our owner is better because they will never liquidate their holdings and only look at dividend payouts. Managing TMB is my priority. I would like investors to view me as a professional who has full responsibility for the bank."
However, Thanong's responsibility for the bank is second after the call of duty. On Wednesday evening, while he was in Hong Kong, Thanong agreed to take up the office of finance minister. Prime Minister Chavalit Yongchaiyudh moved frantically to plug his credibility damage by naming Thanong for the tough job following the abrupt resignation of Amnuay Viravan.
Thanong's acceptance of the finance portfolio was similar to responding to a conscription order. Chavalit gave him the offer, and Thanong could not deny accepting.
Thanong is no stranger to the prime minister. Using the TMB headquarters, Thanong, Surasak Nananukul and Virachai Tejavichit quietly helped Chavalit draft the New Aspiration Party's economic policy platform during the last election that helped propel Chavalit to the post of premier. Surasak and Virachai are now advisers to the prime minister at Baan Phitsanulok.
Thanong has been regarded as a confidant of the military establishment, which controls more than 30 per cent of the Bt275 billion banking organisation. Although there are 14 appointed military personnel on the board of directors, Thanong has succeeded in projecting the impression that he and his professional bankers actually call the shots.
The fact that Thanong had to leave his job as guardian of the military's treasury pot illustrates the fact that Chavalit was desperate for a finance minister whom he could trust. Amnuay's resignation created shock waves in financial markets, which will never accept an incompetent finance minister during the present financial and foreign exchange crises.
Thanong will be facing the demanding task of resolving all the financial crises and putting the Thai economy back on track. It is not known under what conditions he has agreed to take the job, but he must receive full authority from the prime minister and support from all coalition partners if he is to carry out the task of financial reform.
''He is a man of principle," said a banker who knows him. ''But he is more of an operations type than a macroeconomic type, although he loves to read books.
''He really knows the business. You cannot fool him with your deals," added a financial executive.
Thanong was not Chavalit's first choice, though. Virabongsa Ramangkura, Vichit Suraphongchai, Som Jatusripitak, Olarn Chaipravat, Suthee Singhasaneh, Aran Thammano and MR Pridiyathorn Devakula titans in the Thai financial arena almost completely eclipsed Thanong.
Olarn, the president of Siam Commercial Bank, emerged as the hottest candidate by virtue of his legendary grasp of macroeconomic issues. Chavalit called on all his charm on Thursday to persuade Olarn to accept the tough job, but Olarn, fresh from a trip to London, politely declined the offer. The present political conditions make it very unappealing for an outsider to take the finance post.
Olarn went to the prime minister's Nonthaburi residence accompanied by Chirayu Issarangkun na Ayutthaya, director of the Crown Property Bureau, on the excuse of having to tend to the business of the Siam Commercial Bank and its affiliates.
Chatichai Choonhavan, the leader of the Chat Pattana Party, proposed Aran, the chairman of the Industrial Finance Corp of Thailand, and MR Pridiyathorn, as finance candidates to Chavalit. In the end, Chavalit picked Thanong.
Thanong holds a PhD in managerial economics and decision science from Northwestern University, assuming the presidency of TMB in late 1992 after previously working as an economic adviser to the bank in 1979. He joined the bank full time in 1985 and set up the Project and Finance and Treasury Department.
He left TMB in 1990 to join Shinawatra Group (Thailand) as vice chairman and executive finance director, only to return two years later as TMB's new president and CEO following the resignation of former president Supachia Panichpakdi, deputy prime minister in the Chuan government.
If he had decided to stay on at the bank, he would have finished his first five-year term as president in January 1998.